Microsoft Shifts Focus to $12 Billion Display-Ad Market

In the face of increasing competition from the likes of Facebook and Google, Microsoft Corp. is making some serious efforts to avoid losing display-ad clients. According to estimates by EMarketer, the market is growing rapidly and the total display-ad spend in the US is likely to be around $12.3 billion this year.

With display ads becoming an increasingly important part of PPC management, the figure is expected to double to reach $22 billion by year 2015. Companies like Google and Facebook have managed to surpass Microsoft in the area within a very short time. Microsoft was the third biggest display-ad seller after Yahoo! and AOL Inc. (AOL) in 2008, while Google and Facebook were still lagging a long way behind. But presently Facebook, Yahoo! and Google are the top three display-ad sellers, while Microsoft is placed fourth.

The software seller’s market share is around half that of Google and less than 1/3rd of Facebook. Microsoft acquired Atlas for $6 billion soon after Google’s $3.1 billion purchase of DoubleClick.

But soon after, display ad prices slumped and search ads took off. At that point, the software giant felt that capturing the search ad market was a bigger priority. But the shift resulted in some of its clients shifting their display ad dollars to Google and Facebook. Now Microsoft is increasing both financial and personnel investment in the area to show its commitment and reassure clients like Publicis Groupe.

The plans include new Atlas features to help customers design region specific ad copy. The company also plans to add MediaMath, AppNexus and Turn Inc. side-demand platforms as partners.